Allied Farmers is renegotiating its debt repayments with Westpac following the receivership of its subsidiary Allied Nationwide Finance.

Allied, which acquired the loanbook of defunct finance company Hanover last December, owes $16.9m after its total debt of $19m was reduced in June.

The company was forced to postpone a $19.3m capital raising earlier this month when it became clear its financial arm was in trouble.

Business commentator Arthur Lim says Allied will need all its persuasive powers, as Westpac will be keen to recoup its debts.

"Westpac obviously is very concerned about the state of Allied Farmers, it looks like they want their money back.

"That’s the pressure point for Allied now, they have to look at either appeasing Westpac, or raising capital very quickly. And with the way the banks are running their affairs at the moment, they are not feeling generous.”

Mr Lim says Allied Nationwide’s demise is just another turn in its parent company’s downward spiral.

“I think that in taking over the Hanover assets, they were hoping for a new lease of life.

"What has actually transpired is a continuous series of problems."